Domain Registrars Sue ICANN and VeriSign

March 8th, 2004
By Robert McMillan

Just a day after being sued by VeriSign Inc. over delays in approving a new service for back-ordering Internet domain names, ICANN, the organization that controls the Internet's Domain Name System, found itself being sued by a group of eight domain-name registrars seeking to stop the new service's implementation. And this time, VeriSign was named as a co-defendant.

The lawsuit, filed Feb. 27 in the U.S. District Court in Los Angeles, seeks to halt the implementation of a VeriSign-backed waiting list for expired domain names called Wait Listing Service (WLS).

The suit accuses VeriSign and the Internet Corporation for Assigned Names and Numbers, the nonprofit organization responsible for allocating IP address space and managing top-level domains, of "planning to implement a scheme to dupe consumers into buying domain names the consumers will never be able to register, and an unlawful and fraudulent protection racket."

Back-Ordered Domains

Popular domain names are often back-ordered and then auctioned when they become available again. According to Bill Mushkin, CEO of Name.com LLC, one of the registrars behind the lawsuit, while customers may pay a relatively high fee for a back-ordered domain -- which, on average, costs $30 to $60 -- they pay for the domains only when they actually obtain them.

Under the WLS system, back-ordered domains would be awarded on a first-come, first-served basis, but customers would pay an annual fee to back-order the domain, regardless of whether it became available for purchase during the year, Mushkin said.

ICANN failed to return calls seeking comment by press time.

While VeriSign declined to comment directly on the suit, citing company policy against discussing ongoing litigation, Tom Galvin, VeriSign's vice president of government relations, defended the WLS system, saying it would help remove the uncertainty involved in back-ordering domain names.

Galvin said he hopes WLS could soon be implemented. "We've been working on this service for over two years, and we hope, either in Rome or sometime shortly after that, to reach a solution," he said, referring to ICANN's meetings there this week.